1. Which statement is false about cash dividend?
A. Tax-exempt investors usually like low dividend firms.
B. Managers are reluctant to cut dividends
C. Managers smooth dividends
D. Dividends are concentrated among a small number of large, mature firms
E. Clientele effect means stocks attract particular groups based on dividend yield and the resulting tax effects
2. Which statement is false about stock split?
A. A stock split is a corporate action in which a company divides its existing shares into multiple shares
B. A stock split is essentially the same as a stock dividend except expressed as a ratio
C. The purpose of a stock split is to increase stock price
D. Stock splits increase the number of shares outstanding E Stock splits help increase the liquidity of a stock.